WHITE PAPER SPON. Why Should You Encrypt and What Happens if You Don t? Published July An Osterman Research White Paper.

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1 WHITE PAPER N An Osterman Research White Paper Published July 2013 sponsored by SPON sponsored by Osterman Research, Inc. P.O. Box 1058 Black Diamond, Washington USA Tel: Fax: twitter.com/mosterman

2 EXECUTIVE SUMMARY Encryption is absolutely essential to protect data both in transit and at rest. However, most sensitive or confidential content sent through is not encrypted, but instead is sent in clear text and so exposed to potential interception. This puts the owners of this information and its recipients at serious risk of data breaches, damage to corporate reputation, loss of intellectual property and a variety of other consequences that can have significant financial and other ramifications. , while not the only area of concern for data leakage or unauthorized interception of corporate content, should be the primary focus of encryption for corporate decision makers for three reasons: is the dominant communications mechanism in most organizations. For example, an Osterman Research survey has found that the typical information worker sends 30 s and receives 80 s, and spends 149 minutes in their client, on a normal workday. Roughly 95% of the content that flows through corporate systems consists of file attachments, making the primary method for sharing files in most organizations. Although managed file transfer solutions, SharePoint and other tools are widely used, remains the mainstay of most corporate file sharing. Corporate is the most common single application for most users, as well as the most common capability employed on personally owned devices. The latter is of particular concern because of the lack of IT control over sent and received on devices that are owned by employees. Organizations that send or store sensitive data through should establish policies about when and why to encrypt content, train employees about appropriate handling of this data, and implement solutions that will enable automatic, policy-based encryption of data based on its content. ABOUT THIS WHITE PAPER This white paper discusses some of the key issues that decision makers should consider as they develop an encryption plan for . The paper was sponsored by Symantec information about the company and its relevant encryption solutions is provided at the end of this paper. ENCRYPTION IS NOT AS WIDELY USED AS IT SHOULD BE Most s sent from the typical organization are not encrypted, but instead are sent in clear text that allows them to be easily intercepted. While this applies primarily to given its dominant role in corporate communications and collaboration, instant messages, social media posts and other external communications sent by users are also sent unencrypted in most cases. A large proportion of application-generated content, such as diverse as flight schedules or payment statements, is also sent unencrypted. For example, Osterman Research has found that under one-half of organizations enable users to manually encrypt sensitive content, while fewer than one-third encrypt messages based on corporate policies i. Organizations that send or store sensitive data through should implement solutions that will enable automatic, policy-based encryption of data based on its content Osterman Research, Inc. 1

3 Users in Mid-Sized and Large Organizations that Can Encrypt Content 2012 and 2013 Although most is not encrypted, there is a significant unmet need to protect communications via encryption. Even content that traditionally is sent in clear text embargoed financial statements, press releases, purchase orders and the like must be sent encrypted to prevent its unauthorized interception. Plus, there is also value in removing access to content at a later date by revoking decryption rights, as in the case of a former employee or business partner who should no longer have access to encrypted content after a certain date or a change in their status. Many believe that communications will be supplanted by other communication and collaboration tools in the relatively near future. While other tools are finding increased use, the mainstay of communications is and will continue to be , including personal Webmail that is often used for work-related purposes. Consequently, this content must be encrypted to ensure compliance with good governance practices and regulatory requirements, as discussed later in this white paper. Although most is not encrypted, there is a significant unmet need to protect communications via encryption. MOST CONTENT IS NOT ENCRYPTED The majority of decision makers are not happy with the status quo of their policies with regard to encryption. For example, Osterman Research found in a study published in 2012 that only 38% of mid-sized and large organizations find that their policies for encryption of confidential and attachments meet their needs. Add to this the fact that only about one-half of organizations have automated systems in place to scan outbound content for policy violations, sensitive information, credit card numbers, and information that should be encrypted. The primary actions with outbound at such organizations are to automatically apply policy requirements (such as encryption or distribution through a secure channel), or to remind users of corporate policies through a pop-up message ii Osterman Research, Inc. 2

4 Actions That Occur Based on Automatic Scanning of Outbound Action % with sensitive/confidential content is automatically encrypted 48% or delivered through a secure delivery mechanism Users who send with sensitive/confidential content are reminded of corporate policies (e.g., with a popup message) about 48% sending this type of encrypted before the is sent that contains sensitive/confidential content is automatically routed to a compliance officer or supervisor for review before it is 43% sent. that contains objectionable content is flagged, but is sent 28% anyway CLOUD-BASED TOOLS ARE COMPOUNDING THE PROBLEM Encryption challenges are growing due to the use of cloud-based file synchronization and storage tools that are used in organizations of all sizes. For example, Dropbox is widely employed and currently has roughly 60 million users worldwide. An Osterman Research survey conducted in 2013 found that Dropbox and many other cloud-based tools are used extensively in organizations of all sizes, often without IT s blessing or even their knowledge. Percentage of Organizations With Personally Deployed Applications The problem of encryption is becoming worse because of the growing use of cloud-based file synchronization and storage tools. BYOD IS MAKING THE PROBLEM WORSE The Bring Your Own Device (BYOD) craze is exactly what its name implies: the practice of employees to use personally-owned smartphones, tablets, laptops and other personal computing tools to access corporate applications like , databases, CRM systems and other tools; and to create, store and manage data using these platforms. The following figure, from an Osterman Research survey of BYOD use conducted in 2013, demonstrates the widespread use of personally owned devices in the workplace Osterman Research, Inc. 3

5 Percentage of Organizations With Mobile Devices in Use Osterman Research takes a broad approach to BYOD by including applications like personal file synchronization services such as Dropbox and Skype as part of this trend. Because the implications from the use of these tools are virtually identical to the use of mobile devices, we see the use of mobile devices and personally deployed applications to have the same impact on IT departments, and to create the same types of risks for an organization in the context of encryption, security and other issues. BYOD is key element of a broader trend toward mobile interaction with corporate applications and cloud-based services from a variety of platforms. It is being fueled by several factors, including employees desire to use newer platforms at a time when IT budgets often are not able to afford them, the trend toward telework in many organizations, and the general trend toward more employee autonomy. Plus, employee-specified applications and devices enable employees to be more productive, complete their work more quickly, and avoid the frustration and delays of dealing with an overtaxed and underfunded IT department. The key is that BYOD and, by extension because it is so widely employed on personally owned devices means that IT is losing control over content and the process of communications. This makes it even more critical to employ encryption as a tool in the arsenal to prevent the unauthorized access of corporate information whether in transit or at rest. One of the fundamental problems in the context of corporate encryption is that many organizations do not have related policies that meet their requirements to protect confidential and attachments. WHY IS ENCRYPTION NOT MORE COMMON? MOST DO NOT HAVE SOLID ENCRYPTION POLICIES OR AUTOMATED SYSTEMS One of the fundamental problems in the context of corporate encryption is that many organizations do not have -related policies that meet their requirements to protect confidential and attachments. For example, as shown in the following table, only 38% of organizations believe that their encryption-related policies for confidential and attachments meets their needs or meets them well Osterman Research, Inc. 4

6 Degree to Which Current Policies Meet Organizational Needs % Responding Meets Needs or Meets Needs Very Well Policy Attribute % Appropriate use of 61% Employees personal use of 55% Retention periods for -based records 53% Including disclaimers in outbound 53% Deletion policies for -based records 50% Ensuring that employees understand corporate policy 46% Ensuring that employees understand that belongs to the employer 41% Ensuring that employees follow corporate policy 40% Defending against leakage of sensitive information 39% Use of encryption for confidential and attachments 38% Use of personal Webmail accounts 36% SOME SOLUTIONS ARE CUMBERSOME Some early-generation encryption solutions were too difficult for users to employ as a normal part of their daily work, and so were not used to the extent they should have been or at all in many cases. Some of these solutions were not scalable and required a great deal of IT effort to maintain, as well. As a result, many think of encryption as cumbersome and so perceive that newer solutions are saddled with the same problems as their predecessors. While that is not the case for most of the newer solutions, the perception still exists in the minds of many decision makers. SOLUTIONS NEED TO BE OPTIMIZED FOR A MOBILE EXPERIENCE Because of BYOD and the general trend toward greater mobility in the workplace, the mobile experience is becoming a more important decision point. When evaluating encryption solutions, it is essential to consider those solutions support for sending, receiving, encrypting and decrypting messages across a wide array of mobile devices and with the user experience as a front-of-mind consideration. Ideal encryption solutions will support all popular mobile devices without requiring the installation of plug-ins or additional software. Part of the mobile encryption experience that must be considered is that typing strong passwords on a small screen is not easy and prone to error. Plus, the use of PINs for authentication is cumbersome, particularly on mobile devices, and they are relatively easy to guess because about one-quarter of PINs are a spouse's birthday date. Still, PINs are preferable to passwords, largely because mobile devices use auto correction when entering text, making their entry tedious and time-consuming (about seconds for the typical password on a mobile device). Part of the mobile encryption experience that must be considered is that typing strong passwords on a small screen is not easy and prone to error. THE CONSEQUENCES OF NOT ENCRYPTING CONTENT CONTENT CAN BE EXPOSED There are many situations in which unencrypted can be obtained by unauthorized parties: can be intercepted While most is not of sufficient interest to third parties to warrant their attention in trying to intercept it, there are cases in which this interception has occurred. The recent revelations about activities at the National Security Agency 2013 Osterman Research, Inc. 5

7 with regard to intercepting and other content is but one example of many that have occurred in less official ways. Lost or misplaced mobile devices Data interception can occur when unencrypted smartphones, tablets, laptops, USB sticks, mobile hard drives, etc. are lost or stolen. This is a fairly common occurrence and can result in the loss of intellectual property or confidential corporate information. Mistakes by users Another consequence from failing to encrypt content can result from simple user mistakes. For example, the type-ahead feature in most clients means that eventually an employee will inadvertently send an to the wrong party. Among the many examples of user mistakes in sending are the following: o o In September 2012, an employee of Northstar Healthcare mistakenly sent an that contained the names and HIV status of patients being treated for HIV or AIDS iii. Several internal s were sent to some John Stewart Company employees on two days in August These s included the names, Social Security numbers and other sensitive information of other employees in the company iv. o In July 2012, a Quest Diagnostics employee forwarded s with confidential personal information, including Social Security numbers, drivers license numbers, health insurance information and other confidential data. Malicious activity by users Although less common as a source of data leakage than mistakes, disgruntled employees or contractors can misappropriate content for their own or others use, such as sending files through the corporate system to their personal accounts. If systems are not in place to at least detect if not outright block this activity, organizations can lose thousands of documents before they know any of this kind of activity has occurred. DATA BREACH LAWS CAN BE VIOLATED If and other content are not encrypted, the most serious impact will be that sensitive or confidential data can be breached. At present, 46 of the 50 US states and many countries have laws against data breaches that specify steps that must be taken if sensitive content is exposed in an unauthorized manner. The result of a data breach such as unauthorized interception of unencrypted that contains sensitive data is that a law is violated, which triggers a variety of often expensive consequences, such as remediation efforts, lawsuits, negative publicity, etc., as discussed below. If and other content are not encrypted, the most serious impact will be that sensitive or confidential data can be breached. DAMAGE TO CORPORATE REPUTATION A potentially damaging impact of an or other data breach is damage to an organization s reputation. The negative publicity arising from a breach, coupled with backlash from regulators, stockholders, investors, customers and prospects can seriously damage an organization s standing in its industry, potentially putting it out of business in the most extreme of cases. Add to this the fact that customers are less likely to do business with an organization they cannot trust, resulting in potentially severe impacts to corporate revenue in the short term and possibly more significant impacts over the long term. The direct remediation costs for data breaches can be quite expensive as a result of notifying customers, responding to inquiries, updating systems, creating new policies, purchasing credit reporting services for customers, and the like Osterman Research, Inc. 6

8 NEXT STEPS QUANTIFY THE CONSEQUENCES It is essential that decision makers understand the significant consequences that can result by failing to encrypt data. For example, if an unencrypted with internal data like trade secrets, sensitive product plans or customer information is intercepted by an unauthorized party, this can trigger data breach notification requirements, heavy fines, or harm to corporate reputation. As one element of this exercise, it is useful for decision makers to quantify the cost of a data breach as a starting point. For example, if in any given month there is a 2% chance per month of a data breach that could cost an organization $250,000 in remediation and other costs, that represents a $5,000 monthly potential cost to the organization (2% x $250,000). DEVELOP AN ENCRYPTION PLAN The first step in the process of implementing encryption for the first time or improving a deficient encryption process is to identify the content that is most in need of encryption: namely, s and attachments that would be most damaging to the organization if compromised. This might be content like privileged communications between senior business managers; sensitive documents like financial projections or draft policy statements; content that contains obviously confidential information like bids, tenders, acquisition information, employee medical records or customer financial information content; content that could embarrass business partners if intercepted; confidential product plans; etc. A key element of the process is to conduct a sort of inventory on confidential content sources or communication types that should be encrypted when leaving the corporate firewall. This might include developing a list of keywords that should be detected when content is sent outside the firewall, or it might be a list of individuals or roles such as chief legal counsel whose s are more thoroughly screened because they are more likely to contain sensitive or confidential information. Next is to identify the second tier of information that is not necessarily highly confidential, but that decision makers would like to keep confidential, such as embargoed press releases sent to industry or financial analysts, or draft datasheets sent to printers. Addressing these content types normally represents that vast majority of the problem in most organizations and is the easiest to address. This can be followed by the less obvious use cases that might require more effort and integration. It is essential that decision makers understand the significant consequences that can result by failing to encrypt data. Osterman Research found in a study published in August 2012 that 75% of organizations want a real time approach to checking for content that should be encrypted. This content might include Social Security numbers or other confidential information. Another 16% want to manage such potential violations in a post-send mode, while the remaining 9% are not yet sure of how to deal with the issue v. In terms of specifically how to deal with policy violations in the context of sensitive content that is sent without encryption, the same study found that 53% of organizations prefer to notify offenders with a pop-up notification, while 40% want the offending content sent to a supervisor for review. DEVELOP A SOLID BUSINESS CASE AND ROI Organizations most often think of encryption as a defense against something bad happening in an organization i.e., the loss of sensitive or confidential information. While that is certainly true, not as many focus on the proactive, offensive use case for encryption. For example, business cases and ROI considerations for encryption should not be based solely on regulatory compliance or data breach prevention concerns. Instead, encryption can be useful as a means of avoiding fines or loss of business and can enable competitive differentiation and create new business opportunities that might not be available otherwise Osterman Research, Inc. 7

9 For example, the use of encryption might mean that customer statements can be provided electronically. This not only reduces the cost to the sender, but provides an improved customer experience. In the case of , encryption can enable secure communications and transactions over low-cost, well understood and easy-to-use communication channels that are less expensive to manage than postal mail or physical delivery services. CREATE POLICIES FOCUSED ON ENCRYPTION Next is to create detailed policies based on legal and regulatory requirements to protect content through encryption. This step should include a focus on the key business risks that need to be mitigated, consequences for violating corporate data protection policies, and should also provide a detailed and thorough perspective on an organization s BYOD policy. Inclusion of BYOD is a critical step in developing encryption policies, since 97% of organizations permit corporate to be accessed on personally owned devices vi. TRAIN EMPLOYEES An important component of any organization s encryption plan should be employee education about the policies and the dangers of not using appropriate encryption. For example, encryption solutions should be used to provide feedback and indirectly train employees about handling sensitive information, such as through notifications when confidential information is included in an unencrypted or file transfer. Plus, if employees are normally dealing with content that should be encrypted when sent externally, it is our view that automated, policy-based systems should be deployed to handle these tasks automatically. A pop-up message to the offender shouldn't be required let automated systems handle the encryption activities automatically, or route the message through a secure channel. IMPLEMENT POLICY CONTROLS AT THE GATEWAY OR IN THE CLOUD As noted above, encryption should be policy based and automatically encrypt content or at least inform users of the potential need to encrypt based on the detection of various keywords, the domain of the recipient, character strings or identifiers associated with sensitive and confidential information (e.g., Social Security Numbers, credit card numbers, healthcare-related terms) in an , file transfer, etc. However, some encryption solutions lack efficient automation schemes and do not offer simple policy definition schemes. Add to this the fact that IT generally wants policy definition for encryption to be part of a larger policy management system instead of a separate tool that requires its own interface and learning curve. EVALUATE DEPLOYMENT OPTIONS As a key last step, decision makers should evaluate all of the available deployment options for encryption solutions. These include: An important component of any organization s encryption plan should be employee education about the policies and the dangers of not using appropriate encryption. On-premises software deployed on IT-managed servers Physical and virtual appliances Cloud-based services Combinations of two or more of these in a hybrid configuration Many organizations, particularly enterprises, will want to consider a hybrid approach to encryption, perhaps deploying an on-premises solution for staff in the primary location and a cloud-based service for remote users in remote offices that do not have dedicated IT staff Osterman Research, Inc. 8

10 ABOUT SYMANTEC Symantec provides encryption technology delivered from the cloud as part of the security gateway or from on premises appliance and on device software. ENCRYPTION IN THE CLOUD Symantec Security.cloud Symantec Security.cloud delivers always-on, inbound and outbound messaging security, with effective and accurate antimalware, antispam, content filtering and encryption services from a global cloud platform. The Security.cloud Policy Based Encryption add-on helps you to automatically safeguard the security and privacy of sensitive data you exchange with customers and business partners via . The service lets you create and enforce flexible rules in accordance with your policies. By choosing a cloud encryption solution, you can start protecting your sensitive information in days without having to manage digital certificates and encryption keys. Policy Based Encryption assists you in: Implementing regulatory compliance measures more effectively by enforcing encryption automatically based on customizable policy rules. Strengthening relationships with key business partners by providing secure, immediate delivery of confidential data. Managing costs by eliminating manual workarounds for sending secure data, deploying rapidly, and reducing remediation expenses. For more information visit ENCRYPTION ON-PREMISES Symantec Gateway Encryption Symantec Gateway Encryption provides centrally managed, standards-based encryption to secure communications. By encrypting data at the gateway, Gateway Encryption ensures data is protected from unauthorized access in transit, over the public Internet, and at rest on a recipient s mail server. Additionally, automated encryption can be enabled based on recipient domain or other common filtering flags such as credit cards and social security numbers. Symantec Desktop Encryption Symantec Desktop Encryption delivers end-to-end encryption in an easy-to-use interface for employees. Messages are automatically encrypted and decrypted without impacting the user experience, ensuring that full encryption takes place before leaving the user s mailbox for maximum security even within the organization. It delivers the flexibility of automated policy-defined encryption while also allowing users to encrypt their own messages when desired. Symantec Mobile Encryption For your employees to enjoy productivity wherever they are, while keeping their communications secure, Symantec Mobile Encryption keeps it simple. Users have access to all their messages without the need to log into external gateways, with no slowdown of their devices. It keeps business data secure while leaving personal information alone, delivering the ideal BYOD environment for ios, Android, and Blackberry devices. For more information visit Osterman Research, Inc. 9

11 2013 Osterman Research, Inc. All rights reserved. No part of this document may be reproduced in any form by any means, nor may it be distributed without the permission of Osterman Research, Inc., nor may it be resold or distributed by any entity other than Osterman Research, Inc., without prior written authorization of Osterman Research, Inc. Osterman Research, Inc. does not provide legal advice. Nothing in this document constitutes legal advice, nor shall this document or any software product or other offering referenced herein serve as a substitute for the reader s compliance with any laws (including but not limited to any act, statue, regulation, rule, directive, administrative order, executive order, etc. (collectively, Laws )) referenced in this document. If necessary, the reader should consult with competent legal counsel regarding any Laws referenced herein. Osterman Research, Inc. makes no representation or warranty regarding the completeness or accuracy of the information contained in this document. THIS DOCUMENT IS PROVIDED AS IS WITHOUT WARRANTY OF ANY KIND. ALL EXPRESS OR IMPLIED REPRESENTATIONS, CONDITIONS AND WARRANTIES, INCLUDING ANY IMPLIED WARRANTY OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE, ARE DISCLAIMED, EXCEPT TO THE EXTENT THAT SUCH DISCLAIMERS ARE DETERMINED TO BE ILLEGAL. i ii iii iv v vi Osterman Research survey conducted in December 2012 Source: Messaging Policy Market Trends, ; Osterman Research, Inc. Source: PHIPrivacy.net Source: California Attorney General Source: Messaging Policy Market Trends, ; Osterman Research, Inc. Survey Report: Managing BYOD in Corporate Environments, Osterman Research, Inc Osterman Research, Inc. 10

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